The Phaserl


Preparing for the Crash

by Peter Cooper, GoldSeek:

In this update on the broad market S&P500 index we are going to look at no less than 5 charts for it, covering different timeframes, the reason for this is that there are different points to make on each of these charts.

Before looking at the charts for the S&P500 index we are going to review first a range of charts, including the latest charts for Margin Debt and NYSE available cash. These charts provide the direst warning imaginable of impending trouble.

The NYSE Margin Debt chart shows that it is “through the roof” – way higher than it was at the 2000 and 2007 market peaks. When the wheel comes off, out will go the margin calls setting off a brutal self-feeding cycle of liquidation…

Click on chart to popup a larger, clearer version.
Chart courtesy of

The chart for NYSE Available Cash shows a shocking extreme negative cash situation far worse than that at the 2000 and 2007 market peaks, which is of course due to extreme leveraging on capital being employed to play the market. Once the market starts falling, this leveraging is going to work in reverse.

Click on chart to popup a larger, clearer version.
Chart courtesy of

The two charts above don’t suggest an ordinary bearmarket decline – they point to a devastating crash soon.

Next we take a quick look at a pair of charts that appeared in Zero Hedge, which show what happened to Junk Bond prices in 2008 ahead of the crash, and what is happening now. As you can see the same divergence is already evident, and it means trouble. The top chart shows the lead up to now, the bottom chart the lead up to the 2008

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